January 26, 2000

This Man Is Not A Republican

Something strange is happening to John McCain. For a long, long time, he was a pretty typical conservative. Sure, his style was eccentric--he made impolitic remarks about his own party and pointed out the hypocrisies on both sides of the aisle. And, sure, he broke with the GOP leadership on a couple of high-profile issues--campaign finance reform, tobacco taxes. McCain's truth-telling and his war against soft money made him a hero to the liberal press. But, as David Grann argued in these pages last spring ("The Hero Myth," May 24, 1999), it was a strange sort of love affair, based on the media's willful ignorance of McCain's real beliefs. As Grann noted, McCain received a zero rating from the liberal group Americans for Democratic Action, and in 1996 he voted with his party 93 percent of the time. He voted to impeach President Clinton and supported every item in the Contract with America. He fought efforts to raise the minimum wage and opposed protections for gays and lesbians. In short, he was an unconventional character with conventional, conservative views.

So why do many on the right now regard him as an ideological alien, a traitor, even--the vilest of all epithets--a Clintonite? In the words of conservative columnist Robert Novak, "McCain is no longer a conventional Republican who has defied party orthodoxy on the single issue of fund-raising." McCain "spent the fall trying to show how much he agrees with Bill Bradley on campaign finance reform and seems determined to spend the winter showing how much he agrees with Al Gore on taxes," said one of George W. Bush's flacks. Another Bushie declared that McCain "sounds a lot like Al Gore and the Democrats." This is not just campaign spin--the conservative press has sounded the alarm, too. Wall Street Journal columnist Paul Gigot compared a statement by McCain to one by the Democratic National Committee and concluded, "Can't see much difference? Well, that's the point." A Washington Times editorial fumed, "Mr. McCain's tax plan is far more Clintonesque than Reaganesque, no matter how much he seeks to dress it up in conservative rhetoric."

Conservatives are convinced that McCain is no longer one of them. And they are right. The John McCain who today barnstorms the country seeking votes does not believe the same things as the man who dutifully represented his constituents in conservative Arizona for 17 years. What began as an isolated heresy on campaign finance is metastasizing into a full-scale assault on the principles that define what it means to be a Republican today. A year ago, all that was at stake in McCain's presidential candidacy was his ambition and his personal narrative. Today, his battle with George W. Bush has become the most ideologically important Republican contest in two decades.

McCain's most obvious heresy can be summed up in a single word: class. It has been an article of deep conservative faith, at least since Ronald Reagan, that what is good for the rich cannot be bad for the poor. In fact, helping the rich is usually the best way to aid the poor, since, as The Wall Street Journal recently put it, "the members of society most essential to driving the engines of prosperity are those facing the top marginal rate."

So imagine the reaction when McCain began to charge that "sixty percent of the benefits from Bush's tax cuts go to the wealthiest ten percent of Americans" and that, by contrast, "I'm not giving tax cuts for the rich." " Prominent conservatives who back John McCain," writes Novak, "were stunned." A Bush aide responded by accusing McCain of "class warfare"--a conservative term of art for any argument that suggests that different income groups have different interests.

The seriousness of McCain's apostasy can be seen in the fact that even Representative Lindsey Graham, his leading backer in South Carolina, admitted to NBC's Tim Russert that McCain was treading on dangerous ground. But McCain, instead of backtracking, compounded the offense. At a GOP debate in Grand Rapids, Michigan, McCain confronted the class-warfare charge head-on. "I am deeply concerned about a kind of class warfare that is going on right now-- it's unfortunate--there's a growing gap between the haves and have-nots in America, and that gap is growing and it is unfortunately divided up along ethnic lines." In the right-wing mind, class warfare, by definition, is committed against the rich; it cannot be committed by them. McCain's use of the term to describe the opposite phenomenon shows just how perverse his thinking has become.

McCain's own tax-cut plan, while giving nearly all its benefits to the wealthiest two-fifths of taxpayers, is radically progressive for a Republican proposal; Bush would give almost 37 percent of his tax cuts to the wealthiest one percent of Americans, while McCain would grant them almost nothing. And even this understates the difference, because McCain would offset at least half the cost of his tax cuts by eliminating corporate tax subsidies. (This is not just populist but also good economics, since most of those subsidies represent inefficient government intervention in the market.) Since the subsidies McCain targets mainly benefit the very wealthy--who own the bulk of stock--his plan genuinely redistributes wealth from the rich to the middle- and upper-middle classes.

McCain's second heresy is less obvious but equally radical. In contrast to all his GOP opponents, he is preaching fiscal conservatism. And, in the post- Reagan Republican Party, fiscal conservatism is not "conservative" at all. Let me explain.

McCain would devote a huge chunk of the swelling budget surplus to the Social Security and Medicare trust funds to ensure that they don't go bankrupt. Since the trust funds would use this money to reduce the national debt, one could call McCain's plan fiscally conservative in the same way one might call it fiscally cautious or fiscally responsible.

But today's GOP is not primarily interested in reducing debt; in other words, it is not "fiscally conservative." Congressional Republicans want to take the part of the budget surplus that derives from excess Social Security taxes and use it to reduce the debt. This would allow them to use the rest of the surplus for tax cuts without opening themselves up to the charge that they are endangering Social Security.

McCain would also use the Social Security surplus to pay down the debt. But he goes further, taking most of the remaining surplus--money that his colleagues want to use for tax cuts--and giving it to the Social Security trust fund as well. McCain's plan, in other words, acknowledges the trade-off between tax cuts and Social Security: every dollar in lost tax revenue leaves one dollar fewer for Social Security benefits. If the decision is framed this way, voters--who cherish Social Security above all else--will certainly opt for a smaller tax cut. McCain's Republican critics understand that his plan, by focusing on saving Social Security, undermines the case for tax cuts. And it is the primacy of tax cuts, more than anything else, that defines the conservative movement today.

When confronted with the accusation of disloyalty, McCain tries to reclaim the sacred words. "For us to put all of the surplus into tax cuts is not a conservative effort," he told one audience. McCain has called his economic plan "a new fiscal conservatism for the new century." He told me, "I think it's conservative to want to pay down the debt."

But, in the current political configuration, it isn't. To understand why, you must briefly delve into economic history. It's true that conservatives once stood for fiscal conservatism--lower deficits, wariness about inflation, and so forth--but, with the advent of Reaganism, all that changed. For the past two decades, the right has been in thrall to supply-side economics, which holds that the economy is determined above all else by marginal tax rates, particularly those paid by the wealthy. The supply-siders have never exerted absolute dominion over the GOP--they have had to forge coalitions with social conservatives and spending cutters--but tax cuts have remained the party's sine qua non.

In recent years, meanwhile, the Democratic Party has undergone a concurrent transformation. During his first year in office, Clinton cast his lot with Federal Reserve Chairman Alan Greenspan, proposing an economic plan centered on deficit reduction. The ensuing economic growth has more or less enshrined this as Democratic policy. The mainstream liberal model of the economy now resembles the pre-Reagan Republican model.

The prosperity of the Clinton years has put the conservatives in an awkward spot. No longer able to portray tax cuts as necessary for a strong economy-- not without looking ridiculous, anyway--they have been reduced to a kind of moral argument: the budget surplus "belongs" to the taxpayers and must be returned to them. Listen to Bush, the establishment's standard-bearer. "There are only two things that can be done with a surplus," he likes to say. "It can be used by government ... or it can be used by Americans." This formulation cleverly equates debt reduction with new spending, thereby ruling it out. Consider, too, Bush's reply to the objection that a large tax cut would jeopardize the economy: "I do not accept the proposition that it is somehow 'risky' to let taxpayers keep more of their own money." It is a revealing line. He is answering a macroeconomic argument (tax cuts may be risky) with an appeal to individual entitlement (the money belongs to taxpayers).

Compared with an economic philosophy based on the rights of those most burdened by the progressive income tax, an ideology rooted in the interests of the economy as a whole is comparatively progressive. McCain's plan accepts the economic theory shared by Greenspan and Clinton: prosperity results not from cutting tax rates but from reducing federal debt, thereby freeing up savings for capital investment. To be sure, McCain--like Greenspan--has a narrower interpretation of the government's social responsibilities than Clinton, but he has the same basic view of the government's role in promoting prosperity.

McCain, of course, understands that there is no advantage in portraying himself as a Clintonite. So he and his staff present their philosophy in generational, rather than ideological, terms. "The Bush plan is a 1980s plan, and it ignores the lessons of the '90s," recounts Kevin Hassett, McCain's chief economic adviser. "Senator McCain challenged his economic team to figure out why we're doing well in the '90s." But the lessons of the '90s are the lessons of Clinton and Greenspan: Tight fiscal policy, not tax cuts, creates growth.

The strangest thing about McCain's apostasy is how quickly it has developed. For years on end he toed the party line on fiscal policy, betraying not a hint of doubt. Now the Reagan-worshipping, unwonky fighter pilot from the libertarian Southwest, practically alone in his party, is trying to resurrect a tradition of fiscal conservatism that had seemingly disappeared.

McCain offers a prosaic explanation. "In the interest of full disclosure, I didn't pay nearly the attention to those issues in the past," he recalls. "I was probably a 'supply-sider' based on the fact that I really didn't jump into the issue... I also hope that my thinking has changed as a result of the times. I am compelled by information that indicates that there's a growing gap between haves and have-nots in America."

Yet there must be more to it than that. The gap between rich and poor began to widen in the late '70s, and it expanded most rapidly during the '80s, when McCain loyally supported Reaganomics. McCain's newfound skepticism about supply-side economics could be a political calculation. But, if it is, it's a pretty dumb one. His stance on campaign finance reform has already won him a following among the independent voters he needs, and it has already made him suspect in the minds of many GOP partisans. His tax-cut heresy simply confirms the worst suspicions of Republican mainliners and overshadows any concerns they may have had about George W.

The most plausible way to explain McCain's strange intellectual odyssey is to assume that something unmoored him from the discipline and dogma of his party. That something, almost certainly, was campaign finance reform. It is not hard to imagine how this happened: In the course of his reform crusade, McCain has been pilloried by Republicans and praised by Democrats and liberal journalists. Maybe he began to wonder who his friends were. Maybe the overwhelming GOP defense of a system McCain insists is corrupt made him rethink the faith he had placed in the people from whom he took his ideological cues. "I think the party to some degree has lost its way," he told me, "and I think this is because of the influence of big money."

Evidence to support this theory pops up from time to time. Last August, the staunchly anti-abortion McCain told The San Francisco Chronicle that "certainly in the short term or even in the long term I would not support the repeal of Roe v. Wade" and then beat a hasty retreat after conservatives objected. Today, when confronted on the issue, he duly refers to his anti- abortion voting record in the Senate. But those votes were in the past, and, since the senator seems unable to muster any passion on the issue today, pro- life activists legitimately wonder how strongly he still holds to his old views. Similarly, McCain recently called the Confederate flag--a totem for Republicans in the key primary state of South Carolina--a "symbol of racism and slavery." A few days later McCain said, in effect, that it wasn't. Yet, in recanting, he made no effort to conceal that he was reading from a prepared statement, as if to proclaim that his heart wasn't in it. No wonder many on the right are starting to wonder which other long-held positions he might be starting to doubt.

It is not yet possible to systemize McCain's worldview, because he has not done so himself. It's not exactly Clintonism; indeed, it is a species of conservatism, just a conservatism radically different from the one we know today. One way of understanding it is as an amalgam of the legacy of Theodore Roosevelt and something called "national greatness conservatism."

National greatness conservatism is a slightly vague notion developed by David Brooks and William Kristol of The Weekly Standard. It was conceived as a counterpoint to the most right-wing of the Republican revolutionaries, who, Brooks and Kristol argued, detested big government so much that their beliefs threatened the very legitimacy of the state. Brooks and Kristol argue that government, while limited, must be vigorous. They do not explain what government's role ought to be--"It almost doesn't matter what great task government sets for itself," writes Brooks, "as long as it does some tangible thing with energy and effectiveness." In this Brooks and Kristol echo Roosevelt, the man they see as the originator of national greatness conservatism, who in his public and private life held up vigorous activity as its own reward. (Bush's campaign strategist, by contrast, idolizes William McKinley, Roosevelt's nemesis and an ally of the robber barons.)

National greatness conservatism is not really an ideology--it isn't fleshed- out enough--but it is a process for arriving at an ideology, and that is how McCain is using it. McCain frequently cites Roosevelt as his hero, and in some cases the Roosevelt analogy simply confirms values that McCain has long held. Roosevelt, for instance, supported political reform and an internationalist foreign policy. In other instances, McCain seems to be tailoring himself to fit the Roosevelt mold. McCain has a spotty environmental record, and his recent call for "TR Bonds" to restore the national parks is an obvious effort to ape Roosevelt's conservationism.

McCain also shares with Roosevelt a military ethic in which the individual should sacrifice on behalf of a larger goal. This sensibility is not so much opposed to wealth as indifferent to it: people should not place their self- interest above the greater good. Roosevelt argued against McKinley's notion that government should be simply a handmaiden to industry. "Gentlemen," he said, "I have seen it constantly stated ... that we must not deal with anything but business questions. Now, there is a great deal more than that in the life of every great nation. There is patriotism, love of country, pride of race, courage, manliness, the things which money cannot make and which money cannot buy." McCain similarly invokes sacrifice, honor, and " inspir ing young Americans to commit themselves to causes greater than their self-interest." And McCain's notion of the greater good fits with his belief both that Americans should sacrifice for moral values overseas and that they should put the security of future generations ahead of big tax cuts.

Roosevelt, of course, advocated a vigorous federal government. But the government was so much smaller in his day that it is hard to infer from his example many lessons about the responsibilities of the government today. Here McCain's uncertainty is most apparent. He has detached himself from conservative theology, but he has not yet determined how far to allow himself to go. McCain retains an instinctive affinity for the nostrums of conventional Republicanism--small government, lower taxes. At the same time, he is increasingly taken with the aims of liberalism, and he is starting to recognize that the two cannot always be reconciled. The John McCain of today is a mass of uncertainty and contradiction, his economic and moral principles at war with each other.

Take one example. McCain says his economic plan is meant to help "the have- nots." As evidence, he points to his proposal to lift the amount of income subject to the 15 percent tax bracket. "If you put more and more people into the fifteen percent tax bracket, you would have a significant beneficial effect," he says. "The have-nots are not the poorest necessarily; the have- nots are lower- and middle-income Americans, who are not rising as fast as the wealthiest Americans, as well." But expanding the 15 percent tax bracket only helps those who are paying above 15 percent right now, which is only the wealthiest one-fourth of all taxpayers. When told this, McCain is at first undaunted. They "are in that bracket, but their boat is not rising," he insists. "They're a group of have-nots. They're in the have-not group." Later in the interview, though, McCain betrays second thoughts. "Maybe I'm not paying enough attention to the poorest of America," he says. "Maybe my priorities are not correct. I selected this course not thinking that it's perfect but thinking that it's the best that I could come up with."

At the same time, out of political necessity, McCain tries to portray his tax plan in the most conservative light. He describes it as a first step toward a flat tax, starting from the bottom up. But does McCain, who frets about the wealth gap, really want a flat tax, which would exacerbate it? "I'd love to see it, but it's like all other ideals." Translation: yes. But, he continues, "I'm not sure you should ever have a completely flat tax. In other words, should Bill Gates be paying seventeen percent and somebody who's making $30,000 a year the same?" Translation: no.

McCain's ambivalence also comes through in his statements on other issues. He wants vouchers for private schools, but he's unwilling to take money from public schools to do it--even though for most conservatives one of the advantages of school choice is that it shifts money from what they believe to be bloated public school bureaucracies. On health care, he rails against rapacious bureaucrats, woolly-headed liberals, and big solutions imposed from Washington. But, unlike other Republicans, he specifically advocates universal health insurance. This is a circle that cannot be squared. The problem of the uninsured is a consequence of market forces that can only be remedied through significant government intervention. Left to pursue their own self-interests, insurance companies will pick and choose their customers, and individuals will not be able to afford insurance without a subsidy. McCain, by his own admission, is only beginning to think the issue through. " Give me five minutes and I can give you an answer to the Social Security problem, give me ten minutes and I can tell you how to reform the military, but I can't do that on health care," he confessed to The New Yorker's Joe Klein. McCain's instinctive support for universal coverage runs headlong into his instinctive opposition to bigger government. Who knows which principle will be left standing?

Even if McCain pulls off an upset in New Hampshire, he probably lacks the funds to compete effectively with Bush in the avalanche of primaries that follow. But today, unlike six months ago, McCain's campaign stands for something beyond his character. He is introducing something new into American politics: a reform conservatism devoted to cleansing the basic institutions of government--the tax code, the campaign process, the federal budget--in order to restore the faith of the citizenry. Whether he admits it or not, McCain has become the standard-bearer for a conservatism that is, if not hostile to, then at least not synonymous with the interests of accumulated wealth. The Republican establishment is nervous not because it fears McCain can win but because it fears the long-term threat his heresy poses.

McCain and his (few) allies in the GOP understand this. "This is a battle between McKinley and TR," says Marshall Whitman, a McCain adviser. "There are moneyed interests in the party that are deeply threatened by McCain." As Kristol puts it, "McCain's nomination could lead to a breaking of the ideological constructs of the last decade."

It did not start out this way, but the McCain campaign, by its relative success, has become the vehicle for a radical proposition: that many grassroots Republicans do not believe that what benefits the rich necessarily benefits the poor and do not want their government to cut taxes at the cost of its long-term fiscal health. McCain's ideological alternative remains amorphous. But he has radically expanded the boundaries of what it is possible to say in the GOP primary, and his success means that others will pick up where he leaves off. John McCain's candidacy may be overwhelmed by Bush's power, but the debate it has sparked has only just begun.